So I have a dilemma in regards to how to amend my 2020 tax return for crypto transactions I had.
The back story is for the transactions I kept track using a spreadsheet similar to how I would track product or stock sales, buy/sale date, purchase price, sales price ect. The problem is I didn't consider how transactions in Defi are substantiated in a audit and also there were fees/staking that I did not record in my spreadsheet. The only thing I can think of for substantiation is from the blockchain itself with the transaction data coming from the blockchain ledger. I found tracking software for this however if you are missing a wallet, exchange, even one transaction your cost basis will be incorrect from that point going forward. You also have the added problem of software available out there not able to import from various platforms not to mention they don't seem to be 100% correct in what they do import. This means you have to manually enter and would have to find the transaction id with the time stamps ect and find all the errors. Needless to say I have no confidence that the form 8949 would be correct or that I could even figure this out.
Ok so here's the dilemma/question I would like comments on.
With uncovered transactions the IRS wants every transaction listed separately. I may be able to do this but it will take months of work and prob. would not be accurate. I could hire a professional but that would cost thousands (2-3 thousand is the quotes I've received) and I don't anticipate owing more than a 1 thousand. Can I send in a estimated check to cover what I believe I will owe (based on my spreadsheets) before I send in the amended return to stop penalties and interest assuming I send in enough. If so can I send in a check and not amend the return? If I'm audited and the results are equal or less then what I already sent have I still committed a crime by not including the transactions on my return?
